With reference to the ‘Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) consider the following statements: 1. A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction. 2. Properties held benami are liable for confiscation by the Government. 3. The Act provides for three authorities for investigations but does not provide for any appellate mechanism. Which of the statements .given above is/are correct?

QUESTION

Hard

Economy

Prelims 2017

With reference to the ‘Prohibition of Benami Property Transactions Act, 1988 (PBPT Act) consider the following statements:

A property transaction is not treated as a benami transaction if the owner of the property is not aware of the transaction.
Properties held benami are liable for confiscation by the Government.
The Act provides for three authorities for investigations but does not provide for any appellate mechanism. Which of the statements .given above is/are correct?

Select an option to attempt

Explanation

Statement 1 is Incorrect: Whether the owner is aware or not isn't the sole factor. A property transaction can be considered benami if -The property is transferred to one person (benamidar) for a consideration paid by another (real owner). -The transaction is conducted in a fictitious name.

Statement 2 is Correct: Properties held benami are indeed liable for confiscation by the Central Government. This discourages the practice of using benami transactions to hide ownership.

Statement 3 is Incorrect: The PBPT Act does provide for an appellate mechanism. Here's the hierarchy. The Adjudicating Authority Investigates and decides on benami transactions initially. Appellate Tribunal Parties aggrieved by the Adjudicating Authority's decision can appeal to this tribunal.

Therefore, the correct answer is 2 only.Hence, option B is the correct answer.

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